The process-parameter-dependent optical and structural properties of ZrO2MgO mixed-composite material have been investigated. Optical properties were derived from spectrophotometric measurements. By use of atomic force microscopy, x-ray diffraction analysis, and energy-dispersive x-ray (EDX) analysis, the surface morphology, grain size distributions, crystallographic phases, and process-dependent material composition of films have been investigated. EDX analysis made evident the correlation between the oxygen enrichment in the films prepared at a high level of oxygen pressure and the very low refractive index. Since oxygen pressure can be dynamically varied during a deposition process, coatings constructed of suitable mixed-composite thin films can benefit from continuous modulation of the index of refraction. A step modulation approach is used to develop various multilayer-equivalent thin-film devices.